More Consumers Seek Loan Modifications

In January 2017, an estimated 29,000 homeowners received permanent loan modifications from mortgage servicers during the month according to HOPE NOW, a non-profit alliance of mortgage servicers, investors, counselors, and other mortgage market participants. This total includes modifications completed under both proprietary programs and the government’s Home Affordable Modification Program (HAMP). Of the permanent loan modifications performed that month, approximately 20,000 were through proprietary programs while 9,521 were through HAMP. The HAMP program ended officially in December 2016, though servicers will continue to review homeowners who applied before December 31.

Loan modifications increased by 3 percent from December 2016 to January 2017. Total non-foreclosure solutions, such as total loan modifications, short sales, deed in lieu, and workout plans, for January 2017 approximated 102,000, compared to 26,000 foreclosure sales.

Additionally, foreclosure starts and sales saw an increase in those two months. Foreclosure starts jumped from 49,000 in December to 55,000 in January, while foreclosure sales jumped from 20,000 to 26,000 in that same time. HOPE NOW notes that increases in foreclosure starts and sales are typical with their historical data. Although sales and starts are up month-over-month, the year-over-year data saw decreases. Starts are down 4 percent from January 2016, and sales are down 22 percent.

Other non-foreclosure options decreased in January. Short sales dropped from 4,200 in December to 3,700 in January, while the number deed in-lieu stayed at 1,200 in that time. Serious delinquencies are down month-over-month in January, from 1.50 million in December to 1.46 million in January.

“The HOPE NOW Alliance continues to work with homeowners in need and emphasizes on assisting those that are having difficulties with their mortgage,” said HOPE NOW Executive Director Eric Selk. “Our monthly collection of data indicates that the housing market is improving and setting new norms in the post-crisis environment.”